EU injects new dynamism into Asia relations

“ASIA is our new common frontier,” declared French Foreign Minister Hervé de Charette when he explained earlier this month why EU foreign ministers were moving Asia up a few notches on their priority list.

The ministers called for more work to be done on a Union report on creating a new dynamic in relations with the Southeast Asian nations of ASEAN. The goal: to take an attractive package of cooperation plans to the seven ASEAN nations when foreign ministers from both sides meet next month in Singapore.

The group of seven burgeoning economies – Brunei, Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam – has plans for a free trade zone in 2003, and EU governments want the Union to be the ASEAN bloc’s number one trading partner.

They have chosen four priority areas for bilateral relationsand will ask their ASEANcounterparts to agree on them in Singapore.

Most of the priorities are the classical ones: improved trade in goods, services and investment; and cooperation in economic matters and development.

But it is the “inter-regional strategy”, or region-to-region ties, which motivate Europeans. As soon as Asean members create the AFTA, or Asian Free Trade Area, the Union wants to step up the dialogue. The EU has already developed an extensive programme of exchanges of technology, training and expertise with Latin America’s Mercosur bloc, and wants to do the same with AFTA.

“We need to explore the levels of compatibility and see how to facilitate trade between the two zones,” said an aide to External Relations Commiss-ioner Manuel Marín, who will lead EU work on the subject.

Commission officials stop short of suggesting a Euro-Asean free trade zone, but they do foresee some harmonisationof product and certification standards to facilitate trade between the two rich markets.

“Two free trade zones should have an easier time working together,” said Marín’s aide. “We must be able to advance the liberalisation of some sectors through this region-to-region cooperation.”One recent development may become a political stumbling block to such cooperation. ASEAN has decided to make Burma a member, and perhaps even to include Rangoon in next month’s meeting.

The EU, currently in the process of levying trade sanctions against Rangoon, will fight Burma’s inclusion, but has no power to prevent it.

After the EU-ASEAN meeting on 13-14 February, the 22 foreign ministers will be joined on 15 February by their counterparts from China, Japan and South Korea for a Asia-Europe Meeting (ASEM). They are tasked with preparing the next summit of European and Asian leaders, scheduled for April 1998 in London. They will also launch the Asia-Europe Foundation aimed at promoting exchanges of business leaders, technicians and even cultural groups.

Again, trade will be at the top of the agenda. Partner countries have a host of issues to wrestle over, beginning with the question of access to each other’s markets. Foreign ministers will also work on the “trade facilitation action plan” – an ASEM rule book which should be approved by the 25 nations’ economic ministers when they meetin Tokyo in December and formally launched by national leaders at their summit next year.

The aim of the action plan is to set out the trading rules as the partners open their markets to one another’s exports.

“As countries open to each other, it should be on a ‘most favoured nation’ status,” said an aide to Trade Commissioner Sir Leon Brittan, who will not attend the ASEM meeting because he will be negotiating telecommunications sector openingswith World Trade Organisation partners in Geneva.

Other provisions in the action plan should ease customs co-operation among members, simplify trading rules, bring the countries involved into line on common industrial standards, and promote investment flows around the two continents.

The foreign ministers meeting in Singapore will also have to tackle bilateral topics such as disagreements over shipping and maritime safety.

But the Singapore meetings will not be all business – there will be some politics as well.

The ASEM partners must also decide whether to bring India, Pakistan, Australia and New Zealand into their club and give further definition to the pledges for “further cooperation” which they made in the final declaration at the first ASEM summit in Bangkok last March.

South Korea has proposed adding a “vision group” of prominent thinkers outside government who could contribute detached, practical and forward-looking ideas.

In addition, the relationship between ASEAN and ASEM still needs to be fine-tuned, and the group needs to assess developments between North and South Korea. “They are still working on the architecture,” said the Brittan aide.

A host of meetings planned for this year should complete the blueprints for ties between the 370 million residents of the EU and the 1.8 billion Asians living in the 10 ASEM partner countries.

They will include the first meetings of EU-Asia Business Forum in France and in Thailand and a business conference in Indonesia.